Here are comparative balance sheets for Velo Company.Velo CompanyComparative Balance SheetsDecember 31Assets 2020 2019Cash $73,200 $32,700 Accounts receivable 85,600 70,500 Inventory 169,800 186,600 Land 74,000 100,600 Equipment 260,500 200,100 Accumulated depreciation—equipment (65,800) (33,700) Total $597,300 $556,800 Liabilities and Stockholders’ Equity Accounts payable $35,400 $47,300 Bonds payable 151,400 203,000 Common stock ($1 par) 217,500 173,200 Retained earnings 193,000 133,300 Total $597,300 $556,800 Additional information:1. Net income for 2020 was $104,100.2. Cash dividends of $44,400 were declared and paid.3. Bonds payable amounting to $51,600 were redeemed for cash $51,600.4. Common stock was issued for $44,300 cash.5. No equipment was sold during 2020, but land was sold at cost.Prepare a statement of cash flows for 2020 using the indirect method.

Cash flow statement: The Statement of Cash Flows (also referred to as the cash flow statement) is…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Here are comparative balance sheets for Velo Company.

Velo Company Comparative Balance Sheets December 31
Assets	2020		2019
Cash	$73,200			$32,700
Accounts receivable	85,600			70,500
Inventory	169,800			186,600
Land	74,000			100,600
Equipment	260,500			200,100
Accumulated depreciation—equipment	(65,800	)		(33,700	)
Total	$597,300			$556,800
Liabilities and Stockholders’ Equity
Accounts payable	$35,400			$47,300
Bonds payable	151,400			203,000
Common stock ($1 par)	217,500			173,200
Retained earnings	193,000			133,300
Total	$597,300			$556,800

Additional information:

1.		Net income for 2020 was $104,100.
2.		Cash dividends of $44,400 were declared and paid.
3.		Bonds payable amounting to $51,600 were redeemed for cash $51,600.
4.		Common stock was issued for $44,300 cash.
5.		No equipment was sold during 2020, but land was sold at cost.

Prepare a statement of cash flows for 2020 using the indirect method.

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